The Relationship Between Determinants Of Working Capital Management And Financial Distress Levels Of The Listed Manufacturing Companies In Ghana
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ABSTRACT
This study investigates the relationship between Working Capital
Management (WCM) determinants and financial distress level of the listed
manufacturing companies in Ghana. This research used evidence from financial
report of ten manufacturing organizations selected from the main board of the
Ghana Stock exchange. Quantitative research approach involving panel least
square estimates with white cross section were used for analysis. Descriptive
statistical analysis including regression and correlation analysis were also used.
The key finding of this research was that returns on asset, size, growth, and
current ratio as well ascash conversion cycle as internal determinants of working
capital have significant relationship with financial distress level of listed
manufacturing companies in Ghana. Also, Interest rate and market value of equity
as external determinants of working capital have significant influence on financial
distress. The study also found that current liability and current asset as a major
components of working capital have significant relationship with financial
distress and that financial distress level of selected firms can be measured using
working capital determinants through accounting based models. In conclusion,
working capital determinants have significant relationship with financial distress
and if manufacturing firms in Ghana can manage their working capital efficiently,
they can escape financial distress which is one of the key symptoms that herald
corporate failure.
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African Research, R (2021). The Relationship Between Determinants Of Working Capital Management And Financial Distress Levels Of The Listed Manufacturing Companies In Ghana. Afribary.com: Retrieved April 14, 2021, from https://afribary.com/works/the-relationship-between-determinants-of-working-capital-management-and-financial-distress-levels-of-the-listed-manufacturing-companies-in-ghana
Resources, African Research. "The Relationship Between Determinants Of Working Capital Management And Financial Distress Levels Of The Listed Manufacturing Companies In Ghana" Afribary.com. Afribary.com, 04 Apr. 2021, https://afribary.com/works/the-relationship-between-determinants-of-working-capital-management-and-financial-distress-levels-of-the-listed-manufacturing-companies-in-ghana . Accessed 14 Apr. 2021.
Resources, African Research. "The Relationship Between Determinants Of Working Capital Management And Financial Distress Levels Of The Listed Manufacturing Companies In Ghana". Afribary.com, Afribary.com, 04 Apr. 2021. Web. 14 Apr. 2021. < https://afribary.com/works/the-relationship-between-determinants-of-working-capital-management-and-financial-distress-levels-of-the-listed-manufacturing-companies-in-ghana >.
Resources, African Research. "The Relationship Between Determinants Of Working Capital Management And Financial Distress Levels Of The Listed Manufacturing Companies In Ghana" Afribary.com (2021). Accessed April 14, 2021. https://afribary.com/works/the-relationship-between-determinants-of-working-capital-management-and-financial-distress-levels-of-the-listed-manufacturing-companies-in-ghana